We are moving too slowly

The existential threat that businesses and many countries are facing currently is not from artificial intelligence, climate change, the danger of another financial meltdown or a conflict.

The threat they need to address most urgently is an inability to move quickly and the events that we are facing far outpace our ability to understand, orientate, make decisions, and act.

(Spoiler: it’s impossible to plan your way out of a problem. At some point, we have to take action.)

Unfortunately, instead of a bias to action, we dismantle every option to the atomic level via the Socratic method until the original idea is lost or forgotten. We get bogged down with planning for every eventuality. Or we wait ‘until we have all the facts’, forgetting that we will never have all of the facts and that situations change.

The result is that we don’t act in a meaningful timescale and events overtake us, leaving us reactive instead of proactive. We lose the opportunity to get ahead of the situation and often squander the opportunity to act entirely.

But we can fix this.

This is an easily solvable problem

We can stop using 20th century processes, based on 18th century laws, to deal with 21st century problems.

Not only are these unsuitable for the challenges of today, but they are wholly unsuited to the challenges of tomorrow. Particularly when the most serious issues we face – such as climate change or the misuse of ai – have a compounding and accelerating effect. 

We can encourage leaders to take action in spite of the fear of criticism, lawsuits, and armchair quarterbacking.

The plan might be imperfect in the first instance — most are — but we know that in almost every case, we can change course and iterate as we go. Most importantly, we need to reduce the opportunity for spurious legal challenges that have no merit but are simply delaying or disruptive tactics.

We need a corporate Good Samaritan law.

Conversely, we need to crack down on wrongdoers, especially the besuited bandits who cause havoc from the boardroom and get away scot-free. Deliberately flaunting the rules has to be published if we want to encourage good-faith action.

So who are the heroes who will lead this change?

Risk Managers Should be Taking the Lead

Unfortunately, risk managers should be leading the charge here but we’re not.

We seem to mistake a better Bayesian model or more complex spreadsheet for progress. We spend far too long feeling smug after we post a “LOL: heat map = ” meme.

This is simply thrashing around in the shallow end of the pool: noisy and good fun, but ultimately unproductive.

Our intent as risk managers should not be the completion of a risk assessment: it should be to identify and enable the actions necessary to achieve our objectives. We should be creating the conditions for success, not simply cataloguing how things can go wrong.

Again, we can’t spreadsheet our way to success.

A Bias Towards Action

The event cycle or OODA loop is going to get faster and faster so we must too.

But the whole point of the OODA loop is to get to the ‘action’ element ASAP, not languish in the OO part.

But that’s where we seem to be stuck. Maybe that’s due to the demands of endless compliance tasks or because our leaders see us as spreadsheet jockeys instead of part of the decision-making system.

Whatever the case, unless we speed up our processes and integrate risk into the decision-making process more tightly, we are failing as risk managers.

There’s no point simply becoming risk recorders: observers of events. Instead, we need to grasp the initiative, sharpen our tools and processes, and get back to our roots: as the enablers of action.

After all, it was an ability to understand and put a price on risk that allowed ships to undertake dangerous, potentially ruinous voyages in the 1600s.

An ability to understand and overcome challenges is what put humans into space.

An ability to move fast and take risks in the face of uncertainty is what allowed BioNTech to create a COVID-19 vaccine in a fraction of the normal time.

And this kind of bias towards action, based upon our best understanding of the risks at that time, is what we need if we are going to survive and thrive.

But that all starts with taking action to take action.